Employment cost calculator for United Kingdom - Calculate taxes, benefits, and total employer costs
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Employment Cost Calculator in United Kingdom

Hiring in United Kingdom? Instantly calculate your total cost to employ — taxes, benefits, and more

Updated on August 17, 2025

Employment Cost Calculator for United Kingdom

Calculate your complete hiring costs for United Kingdom employees, including payroll taxes, social security contributions, employee benefits, and management fees. This salary calculator provides accurate employer cost estimates for informed hiring decisions.

Employer Tax Contributions

Tax Type Rate Base
Employer's National Insurance (Class 1 Secondary) 15% (from April ) Employee earnings above £5,000 annually (from April )
Apprenticeship Levy 0.5% Annual pay bill over £3 million
PAYE Income Tax Employee's marginal rates Employee's gross pay

Filing & Compliance

  • Register as an employer with HMRC before your first payday if you pay an employee £96 or more weekly, employ someone receiving a pension, or use subcontractors under the Construction Industry Scheme.
  • PAYE (Pay As You Earn) payments are due by the 22nd of the next tax month if paying electronically, or by the 19th if paying by post.
  • Submit final PAYE submission (FPS) for the tax year by April 19.

Income Tax Brackets

Income Range Tax Rate
Up to £12,570 0%
£12,571 to £50,270 20%
£50,271 to £125,140 40%
Over £125,140 45%

Employee Contributions

Deduction Type Rate Cap
National Insurance (Class 1) 8% On earnings between £12,570 and £50,270 annually
National Insurance (Class 1) 2% On earnings over £50,270 annually
Student Loan (Plan 1) 9% On earnings over £26,065 annually
Student Loan (Plan 2) 9% On earnings over £28,470 annually

Personal Allowances

  • Standard Personal Allowance: £12,570
  • Allowance reduces by £1 for every £2 earned over £100,000
  • Allowance is zero if income is £125,140 or above
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